Sete Brasil submits its reorganization plan for recovering from bankruptcy

Sete Brasil, the oil rig chartering firm that filed for bankruptcy in April, has presented its draft reorganization plan that entails drastic downsizing and a quest for $5bn in new investment, according to Reuters.

Sete’s financial woes are interlinked with the massive corruption case surrounding Brazil’s state oil firm Petrobras, which co-founded Sete Brasil and was its only customer.

Under the plan Sete would, assuming it gets approval from its creditors, attempt to raise the $5bn so it can construct between 8 and 12 oil rigs.

Ideally Sete would like Petrobras to purchase the rigs but it would look to other customers, too.

Sete entered bankruptcy protection when it was unable to negotiate a long-term contract with Petrobras, which has been retrenching in the midst of the huge losses resulting from its bribes-for-inflated-contracts scandal.

Some of Sete’s creditors have written off parts of the outstanding $4.7bn in loans that the company has struggled to repay.

The reorganization plan was submitted to a court in Rio de Janeiro for its consideration.

With 28 years experience writing and editing for newspapers in the UK and Hong Kong, Donal is now based in California from where he covers the Americas for Splash as well as ensuring the site is loaded through the Western Hemisphere timezone.